Gas prices act as congestion fee would but without the monetary benefits

High gas prices are pushing more commuters onto mass transit options. (Gas $4.37 by flickr user 54east)

As Americans prepare to hit the road later today for their Fourth of July weekend travels, gas prices are at an all-time high. The national average cost for unleaded regular gas checks in at $4.092 per gallon while New Yorkers are paying an average of $4.297 per gallon. These numbers, to Americans, are astronomical.

In New York City, however, the law of unintended consequences has taken over. As high gas prices drive Americans out of their cars, a few analysts are noting that the traffic-mitigation effects of the $4.30-gallon are mimicking, to a lesser extent, Mayor Bloomberg’s failed congestion pricing scheme. In a very well done article in The Times today, William Neuman explores how traffic volume is decreasing as gas prices increase.

The gist of it is as follows: As gas has climbed well past the $4-per-gallon mark, the MTA and the Port Authority have been reported decreases in traffic through their toll booths of around 4.2 to 4.7 percent. Meanwhile, subway ridership was up 6.5 percent over the same time period with smaller but noticeable increases on Metro-North (4.3 percent) and the Long Island Rail Road (5.5 percent). The PA’s PATH trains saw a jump in ridership of nine percent. Even parking garages in the area are reporting fewer cars.

In a way, then, the city isn’t too far from temporarily achieving Mayor Bloomberg’s goals of reducing congestion. Of course, as Neuman points out, the goal of congestion pricing was to reduce traffic at peak hours, and this current reduction is more spread out. Meanwhile, it’s clear that drivers who are opting not to drive will slip behind the wheel as soon as — or is that if? — gas prices dip again. So on the flip side, high gas prices aren’t at all like the congestion pricing plan, and a few traffic consultants believe that this is a questionable decrease as many drivers, looking to save all they can, are opting for free bridges instead of toll roads. The decrease in volume could be as little as two or three percent.

There is, of course, another catch as it relates to mass transit. The analysis is Neuman’s:

Gas price-induced traffic reduction might have a downside. Mr. Bloomberg’s plan was intended, among other things, to raise hundreds of millions of dollars a year for mass transit improvements by charging cars an $8 fee to enter the area of Manhattan below 59th Street. The plan was defeated in April when legislative leaders in Albany refused to bring it up for a vote.

In contrast, the current reduction in traffic at bridges and tunnels could actually take money away from transit, because a large portion of the tolls collected at the transportation authority’s crossings helps to finance the subways, buses and commuter railroads. In May, toll revenues were more than $4 million below budget projections, and Gary J. Dellaverson, the authority’s chief financial officer, said that June toll revenues appeared to be down even further.

So far, the drop has been more than offset by an increase in fare collections generated by higher transit and rail ridership, but Mr. Dellaverson said that the combination of slipping toll revenues and the increased cost of fuel for the authority’s buses and trains could eventually outpace ridership revenue gains.

In the end, then, it’s the same old story for the MTA. A lack of dedicated revenue not tied into market forces is forcing the agency into a corner. For our city’s air, for our roads, it’s encouraging to see traffic dipping as gas prices go up. But for the health of the MTA, this artificial free-market quasi-congestion pricing impact will only serve to deprive the agency of toll revenue while taxing train lines already at or near capacity without offsetting these increases with more revenue. And that is a recipe for disaster.